Freeport IPO To Be Conducted After Divestment

Energy and Mineral Resources Minister Ignasius Jonan has said that gold and copper miner PT Freeport Indonesia will hold an initial public offering (IPO) after the completion of its divestment to Indonesian entities as required by law.

“After the central and local governments in Papua own 51 percent of the shares, the company will go public,” said Jonan at the Indonesia Stock Exchange (IDX) in Jakarta on Tuesday as reported by kontan.co.id.

Jonan said the government disagreed with Freeport's plan to conduct an immediate IPO because the government was preparing for the divestment.

“In line with guidance from the President, the divestment will be implemented in stages based on our [financial] ability. Hopefully, it can be implemented soon,” Jonan added.

The government and Freeport Indonesia was initially scheduled to complete negotiations in October, but the deadline has been extended until January 2018 because several issues remain unresolved.

The divestment agreement was announced by Freeport McMoRan CEO Richard Adkerson during a joint press conference with Finance Minister Sri Mulyani Indrawati and Energy and Mineral Resources Minister Ignasius Jonan on Aug. 29.

The company also agreed to convert its contract of work (CoW) into a special mining permit (IUPK), build a smelter within the next five years and increase its contribution to state revenue from its Grasberg mine in Papua in exchange for the contractual extension for the mine operation until 2041. (bbn)